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(Image Source: CNNMoney)
BY ELISA LOPEZ AGUADO
ANCHOR LAUREN ZIMA
A new time for Time Warner. The company is reportedly in talks to sell most of its magazine
titles to Meredith Corporation in hopes of moving ahead from its 40 percent decrease
in sales over the past decade.
A deal would result in: - Time Warner mainly remaining a film and
television company, where it’s seeing growth - Time Warner still owning TIME magazine,
Sports Illustrated and Fortune - Meredith Corporation taking control of most
of the other titles -- including People, Entertainment Weekly, InStyle and Real Simple.
[Source: Time Warner]
Some call it an impulse buy for Meredith. But the reported $2.5 billion deal is more
of a joint venture than a simple sale. [Source: The New York Times]
Meredith and Time will reportedly form a new, publicly traded joint company. Bloomberg’s
Edmund Lee says this could help Time Warner big time -- it’s had trouble making the
move from print to web, where ad rates are traditionally much lower.
“The move would let Time Warner offload at least part of its worst-performing major
division, helping insulate the company from an industry wide slump in advertising sales.”
So will Time Warner’s revenue increase as a result of the move? Forbes notes the sale
of People magazine is surprising -- it had $997 million in advertising sales last year
and is considered one of the most profitable magazines out there.
Details are still being worked out. One analyst tells CNBC it’s not really close, and what’s
more — no one really knows yet what’s going to happen.
“It’s probably two weeks away from happening, if it happens at all. I should say that it’s
still up in the air. There’s a lot of speculation of what’s happening.”
If the deal did go through, it would be the biggest in Meredith’s history.